Stock Of The Week : MAJUPERAK

MAJUPERAK Holdings Bhd rebounded from the most recent lows of 26.5 sen on Sept 24 to achieve a three-month high of 33.5 sen in early trading yesterday amid follow-through bargain hunting interest before paring gains to settle flat at 31.5 sen owing to an apparent profit-taking activity.

The recovery came after a round of correction recently.

Based on the daily bar chart, this stock has carved out a short-term bullish wave and it looks like there are more upside potential in the pipeline, as trading started to pick up steam the past couple of days, indicating growing investors' interest.

Elsewhere, the daily slow-stochastic momentum index was rising. Its oscillator per cent K reversed up from the mid-range and climbed above the oscillator per cent D to trigger a short-term buy on Thursday.

Similarly, the 14-day relative strength index improved significantly from the mid-range earlier of the week to settle at at the 78 points level yesterday.

Meanwhile, the daily moving average convergence/divergence histogram continued to expand upward against the daily signal line to retain the bullish note. It had called for a buy on Sept 27 and returned to the positive territory.

Technically, indicators are pretty encouraging, implying prices are likely to firm in the immediate term, with initial resistance anticipating at the 39 sen-40 sen range.

A successful clearance of this barrier may propel prices higher to challenge the stiff upper resistance, resting at the 48 sen-50 sen band. Current support is expected at 30.5 sen. An additional floor is pegged at the 29.5 sen level.


By K.M. LEE, thestar.com.my

● The comments above do not represent a recommendation to buy or sell.